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Govt proposes setting up Economic Law Commission

The government on Saturday proposed to set up an Economic Law Commission to overhaul the entire gamut of economic legislations in the liberalised environment and said the new Income Tax Act was expected by March 2002.

"We are seriously thinking that there is a need to appoint an Economic Law Commission to look into these (tax laws) and to what extent these laws should be amended," Union Finance Minister, Yashwant Sinha, said at the silver jubilee function of Income Tax Settlement Commission.

The finance ministry would discuss the issue with the law ministry shortly to work out the modalities, he said.

The proposed commission was necessary in view of the ongoing liberalisation and the influence of the globalisation on the Indian economy, the finance minister said.

Countries, which had liberalised their economies have undertaken necessary changes in tax laws to effectively deal with the changed situation but India is yet to progress in this area so far, he said.

"It is necessary to look at the entire gamut of Income Tax laws," he said, adding government would come up with a new tax-assessee friendly Income Tax Act taking into account all the necessary amendments required for the future.

"We will try to come out with the new Act by March 2002," he said.

Sinha also stressed the need for a fresh look at the requirement of tax exemptions now that the tax rates in the country were moderate.

Expressing concern over the 'mind-boggling' tax arrears of about Rs 500 billion, he said: "They are perhaps non-realisable. But we need to review it and look at these in a comprehensive manner."

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